Australian Vanadium Limited
Annual Report 2018

Plain-text annual report

ACN 116 221 740 Annual Report 30 June 2018 Australian Vanadium Limited 2018 Annual Report Contents Corporate Directory Letter from the Chairman Directors’ Report Statement of Profit or Loss and Other Comprehensive Income Statement of Financial Position Statement of Changes in Equity Statement of Cash Flows Notes to the Financial Statements Directors’ Declaration Auditors’ Independence Declaration Independent Auditors’ Report Annual Mineral Resource Statement ASX Additional Information 2 3 4 20 21 22 23 24 45 46 47 50 54 1 Australian Vanadium Limited 2018 Annual Report Corporate Directory Directors Vincent Algar (Managing Director) Leslie Ingraham (Executive Director) Brenton Lewis (Non-Executive Chairman) Daniel Harris (Non-Executive Director Company Secretary Neville Bassett Registered Office Level 1, 85 Havelock Street West Perth WA 6005 Telephone 08 9321 5594 Facsimile 08 6268 2699 Share Registry Computershare Investor Services Pty Ltd Level 11 172 St Georges Terrace Perth WA 6000 Telephone 08 9323 2000 08 9323 2033 Facsimile Auditors Armada Audit & Assurance Pty Ltd 3 Alvan Street Mount Lawley WA 6050 Securities Exchange Listing Australian Vanadium Limited shares (AVL) and options (2 cents/expiring 31 December 2018) (AVLO) are quoted on the Australian Securities Exchange (ASX). 2 Australian Vanadium Limited 2018 Annual Report Letter from the Chairman Dear Fellow Shareholders, On behalf of your Board of Directors, I have pleasure in presenting the 2018 Annual Report and Financial Statements of Australian Vanadium Limited (“AVL” or the “Company”) for the 30 June 2018 financial year. The last 12 months have seen the Company achieve major milestones in its efforts to bring its flagship Gabanintha vanadium project in Western Australia closer to development, successfully positioning the Company as an Australian leader in a growing Vanadium sector as it seeks to take advantage of the significant rises in global vanadium prices to transform into the world’s next vanadium producer. In addition to a resource upgrade at Gabanintha, important achievements include concluding the Company’s first Memorandum of Understanding with Chinese vanadium carbon nitride producer Win Win Corporation, the appointment of key vanadium experience into the AVL team and seeing significant growth in the Company’s share price and market capitalization. These have cemented AVL’s Gabanintha Project as a world-class vanadium resource in size, quality and grade with excellent prospects for further development. The updated mineral resource now comprises 175.5Mt at 0.77% vanadium pentoxide (V2O5), made up of a Measured Mineral Resource of 10.1Mt at 1.11% V2O5, an Indicated Mineral Resource of 24.0Mt at 0.63% V2O5, and an Inferred Mineral Resource of 141Mt at 0.77% V2O5. The identification of a cobalt-nickel-copper by-product opportunity from sulphide minerals contained in the Gabanintha mineralisation has been another highlight of the year’s work, further differentiating the project from other vanadium projects emerging on the ASX during the year. The Mineral Resources provided strong support for commencement of a Pre-Feasibility Study during the year, advancing the project towards detailed feasibility in 2019. The growing team at AVL has also been advancing key activities in the areas of environmental approvals and negotiations with Native Title groups. These steps will ensure the all-important environmental and community support for the timely approval of a mining lease over Gabanintha. The ongoing shortage of supply, and consistently increasing demand for vanadium in steel products, coupled with the rapidly growing needs of vanadium energy storage applications has seen vanadium prices increase from US$2.50/lb V2O5 in November 2015 to over US$20/lb V2O5 in September 2018, approaching a tenfold increase. An ongoing level of higher pricing and demand will be highly supportive of the Company’s efforts in moving the Gabanintha project towards development in the shortest possible timeframe. I wish to thank shareholders for their continuing support throughout the year and extend my sincere thanks to the Board, management and staff for their contributions and efforts. Yours faithfully Brenton Lewis Chairman 3 Australian Vanadium Limited 2018 Annual Report Directors’ Report CORPORATE HIGHLIGHTS The past year has seen Australian Vanadium Ltd make progress in its key strategic areas. A summary of key events follows: Gabanintha Vanadium Project • An updated Measured, Indicated and Inferred Mineral Resource was announced, comprising of 175.5 million tonnes (Mt) at 0.77% V2O5 which includes a discrete high-grade zone containing 93.6 million tonnes at 1.00 % V2O5 in Measured, Indicated and Inferred Categories. The discrete high- grade zone is currently the primary focus of economic studies at Gabanintha. • Metallurgical testwork identified sulphide concentrations of cobalt, nickel and copper in the non- magnetic tailings stream. Follow-up testwork has confirmed that a by-product of cobalt, nickel and copper sulphide concentrate can be produced with potential to increase revenue at Gabanintha. • Pre-Feasibility Study (PFS) work has been ongoing throughout the year, with a base case released during September 2018. • Definitive ore concentrate test work nearing completion. Inputs to be applied to flow-sheet design and PFS mining and processing studies. • Environmental base line sampling surveys completed. Information to form part of future Environmental Impact Assessment and mining development proposal. • A proposed Mining Agreement has been prepared and submitted to the Native Title group for consideration. • Metallurgical test work results confirmed the Company’s view that Gabanintha will be able to supply high quality V2O5 products to meet the needs of energy storage and steel making customers. • Appointment of key technical consultants, external and internal • MoU signed with Chinese steel and alloy product company Win-Win Development Group for potential finance of vanadium offtake. VSUN Energy • Residential vanadium energy storage system review completed, Company to focus on sale of imported systems while evaluating advances in component technology. • Residential flow battery from SCHMID Energy Systems (Germany) for off-grid sites now available for order. • Exclusive Dealership Agreement with Gildemeister terminated allowing VSUN Energy to market full range of Vanadium Redox Flow Battery (VRFB) systems from multiple vendors. • Vanadium Redox Flow Battery (VRFB) sales expanded to include new products from other suppliers, offering greater flexibility of pricing and sizing for potential customers. • Registrations of interest submitted to both Western Power and Horizon Power. • Appointment of graduate Energy Data Modeller to support technical battery modelling and sales Blesberg Project, South Africa • Drilling was completed at Blesberg, results indicate localised development of low-grade LCT mineralisation. • Extensive pegmatite development containing high quality and proportion of glass/ceramic quality microcline feldspar identified from drilling. • Project deal re-negotiated around feldspar development. Bryah Resources Limited • Secured a 13.3% holding in Bryah Resources Limited, which successfully listed on ASX in October 2017. Corporate Matters • Appointment of China focused commodity and marketing consultant Mastermines. • $5,505,000 raised through placements. 4 Australian Vanadium Limited 2018 Annual Report REVIEW OF OPERATIONS Gabanintha Vanadium Project The Gabanintha Vanadium Project is located approximately 40km south of Meekatharra within the northern Murchison region of Western Australia. Access from Perth is via the Great Northern Highway and the Meekatharra-Sandstone Road (Figure 1). Figure 1 - Location of Gabanintha Vanadium Project and adjacent vanadium deposits 5 Australian Vanadium Limited 2018 Annual Report The following is a summary of activities undertaken on the Gabanintha Vanadium Project during the period up to the date of this report. Mineral Resource Estimates An upgraded Measured, Indicated and Inferred Mineral Resource was estimated, comprising of 175.5 million tonnes (Mt) at 0.77% V2O5 which includes a Measured and Indicated Mineral Resource of 34.1Mt at 0.77% V2O5. The revised Mineral Resource estimate includes a geologically distinct massive vanadium bearing magnetite high-grade zone that is the focus of ongoing economic studies. The Measured, Indicated and Inferred Mineral Resource estimate for the high-grade zone is 93.6Mt at 1.00% V2O5 which includes 10Mt at 1.11% V2O5 in the Measured Resource category, 4.9Mt at 1.09% V2O5 in the Indicated Resource category and 78.6Mt at 0.98% V2O5 in the Inferred Mineral Resource category. The company identified significant concentrations of cobalt, nickel and copper in mainly sulphide minerals in the non-magnetic fraction of previous metallurgical test work. Estimation of cobalt, nickel and copper content follows bench scale test work and generation of sulphide flotation concentrates containing 3.8% - 6.3% base metals including 1.54% - 2.02% cobalt, 1.36% - 2.58% nickel and 0.82% - 1.70% copper. This indicated potential for the sale of a cobalt, nickel and copper sulphide concentrate by-product from Gabanintha. Consequently, an initial Inferred Mineral Resource of 12.5 Mt at 206 ppm Co, 659 ppm Ni and 222 ppm Cu was estimated during the year. See table below: Zone High-grade Fault Block 20 Fresh material Classification Measured Indicated Inferred Total Mt - - 12.5 12.5 Co ppm - - 206 206 Ni ppm - - 659 659 Cu ppm - - 222 222 S % - - 0.14 0.14 Pre-Feasibility Study (PFS) PFS work has been ongoing throughout the year, with a base case released during September 2018. The Company is evaluating both traditional and non-traditional processing routes as it looks to maximise the value of its world class Iron-Titanium-Vanadium resource at Gabanintha. The PFS is planned for completion by December 2018. Negotiations have been held with the relevant Native Title party in respect to the Gabanintha mining lease application, M51/878. These negotiations have reached the stage where the Company has prepared a draft mining agreement for consideration by the Native Title party. Having recently concluded a similar mining agreement in respect to the nearby Nowthanna Hill mining lease, the Company believes that negotiations in respect to the Gabanintha mining lease can be successfully concluded. Environmental studies Throughout 2017, the Company and its environmental consultant completed flora, fauna and subterranean fauna baseline studies covering both autumn and spring seasons over the Gabanintha mineral resource area and the surrounding environments, which are most likely to be affected by future mining and processing activities. Detailed reporting from these studies were concluded during the year and form an essential part of submissions for the regulatory approvals process. . Vanadium experts appointed During the year AVL built a team of world class professionals to advance the Gabanintha Project. Key appointments were: 6 Australian Vanadium Limited 2018 Annual Report • Non-Executive Director, Daniel Harris was appointed as Technical Director for the project. • Todd Richardson, who has been appointed as Project Manager to drive the PFS; • Wood Mining and Metals, led by Principal Engineer Brian McNab, who were appointed as the primary contractor for the PFS. The depth of knowledge and experience in the vanadium sector that these expert appointments bring provides AVL with a leading edge in the vanadium exploration space. Vanitec The Company continues to actively participate in this important vanadium industry group. Mr Harris and Mr Algar have both attended Vanitec conferences during the reporting period. Mr Algar is a member of the Vanitec Energy Storage Committee. Win-Win Development Group Agreement The Company announced in June 2018 that it had signed a Memorandum of Understanding (MOU) with Chengdu based, Chinese steel and alloy product company Win-Win Development Group. The agreement provides an understanding between the two companies to further discussions around project finance and purchase of vanadium for steel strengthening. Win-Win is currently building a 5,000 tonnes per annum (tpa) vanadium carbon nitride (VCN) production line which requires approximately 7,000-8,000tpa of 98% V₂O₅. The first stage will require 2,000-3,000tpa and be operational in 2019 and the second stage is planned for the following year. Win-Win has a shareholding in an operating production line currently producing 2,400tpa of VCN products for existing steel companies. Figure 2 Win-Win Management team with AVL at Win-Win Development Group Head Office in Chengdu VSUN Energy VSUN Energy Pty Ltd is a 100% owned subsidiary with the sole focus of the development of the Australian market for vanadium flow batteries. Vanadium Redox Flow Battery VSUN Energy’s initial installation of a 10kW-100kWh VRB at a native tree nursery in Busselton, Western Australia has been performing as expected since October 2016. Despite some cloudy periods where less solar energy was generated, the site has not needed to take power from the grid during this period, meaning that it has in effect been providing an off-grid solution. 7 Australian Vanadium Limited 2018 Annual Report VSUN Energy continues to market commercial vanadium energy storage systems suitable for business and stand-alone microgrids through to utility scale opportunities. During the period the Company continued its marketing activity and advanced a number of leads to proposals and detailed review prior to approval. Residential VRFB During the period, VSUN Energy commissioned a strategic analysis of the residential battery market. The results highlighted that the VRB has significant points of difference from other forms of residential energy storage, including number of hours of energy stored, cycling robustness and non-flammability. VSUN Energy has been working with SCHMID Energy Systems in Germany on the supply of a domestic scale VRFB system. Work is ongoing to ensure compliance with Australian standards for grid attached installations. This mainly involves integration of the BMS (Battery Management System) with Australian approved inverters. Consequently, at this stage installation of VRFB is restricted to off-grid settings only. The base model Everflow VRFB system is a 5kW/15kWh unit, which supplies 5kW of power with 15kWh of energy storage, providing 3 hours at a constant load of 5kW. In typical Australian residential environments, this system will provide 4-8 hours of energy. Laboratory Scale Vanadium Flow Cell Constructed VSUN Energy personnel have constructed a laboratory scale vanadium flow cell for electrolyte testing and demonstration purposes. This work will allow VSUN Energy to easily verify the quality and performance of electrolyte prepared in its pilot plant. The Company is now able to scale up the test to use a larger commercial stack configuration. The aim being to continue to grow the Company’s expertise in both electrolyte and battery construction. Coates Project The Coates vanadium deposit is situated approximately 35km east of metropolitan Perth in the Shire of Wundowie. Exploration at Coates was undertaken in the 1970s after its discovery in the early 1960s. Mining plans have previously been produced by Agnew Clough Ltd on the Coates vanadium deposit, although no significant mining was undertaken. Previous metallurgical testwork produced favourable results and the Company will investigate the viability of developing the site. During the period, AVL’s exploration licence over the Coates vanadium deposit was granted. Nowthanna Hill Project During the year, following the successful negotiation of a mining project agreement with the Yugunga-Nya people, mining lease M51/771 was granted in August 2017. No field work has been undertaken since the lease was granted due to the exclusion of uranium as a condition of the mining lease approval. The Company has initiated a JORC 2012 Compliant Resource estimation for Uranium and Vanadium at Nowthanna. Blesberg Project The Blesberg Project is located approximately 80km north of Springbok in the remote Northern Cape Province of South Africa. It lies at the western end of the Northern Cape Pegmatite Belt. This belt extends from Vioolsdrif in the west for about 450 km towards the east. The deposit is one of the largest known economically mineralised and exploited pegmatite deposits in the Pegmatite Belt. Mining at Blesberg commenced in 1925. The main products from later mining were beryl, bismuth, tantalite-columbite, spodumene, feldspar and mica. Feldspar production from the mine was reported to be of very high quality, with the feldspar being pure white and unstained by iron oxide. AVL’s objective at Blesberg is to assess the value of any Lithium-Caesium-Tantalum (LCT) pegmatites present there, including the volume of ceramic grade feldspar and of high value by-products of spodumene, beryl and tantalite. During 2017, the Company completed 41 holes (3,128m) of Reverse Circulation (RC) drilling under the targeted budget requirements (see ASX announcement dated 23 November 2017). The programme was designed to achieve a drill intersection spacing of 50m, sufficient to allow good resolution of the pegmatite geometry and mineral distribution. 8 Australian Vanadium Limited 2018 Annual Report Drilling results confirmed the extension of the pegmatite beyond the historical mine particularly to the west under shallow cover, amenable to simple open cut methods. Lithium, beryl and tantalum minerals were identified in drill cuttings. However, assays of these minerals in drilling were disappointing overall and indicate that the Blesberg pegmatites are highly zoned. Beryl, spodumene and tantalum mineralisation occurs in intense, but isolated areas along the drilled length of the pegmatite body. The high purity of the large crystalline feldspars observed in drilling support a feldspar focus at Blesberg, including the possibility of by-product extraction of lithium, beryl and tantalum minerals. Samples from the drilling and existing excavation are being collected to complete first-pass, low-cost metallurgical recovery tests. Confirming the recovery of a significant portion of the high-quality feldspar is central to any future development of the project. The Company is proceeding to calculate and report a mineral resource estimate in accordance with the 2012 JORC Code as part of its agreement with the project vendors. Earn-In Deal Renegotiated Following the receipt and analysis of the results at Blesberg, the company has concluded that there is only localised development of low-grade LCT mineralisation. The drilling has, however, identified extensive pegmatite development containing a high quality and proportion of glass/ceramic quality feldspar. Since the value proposition of the project has changed significantly compared to the original earn-in deal, which was centred on lithium and tantalum mineralisation, AVL suspended the remainder of the cash payments of USD750,000 due under the agreement to the vendors of Southern African Tantalum and Lithium Mining Pty Ltd (SALT) and renegotiated an agreement that more accurately represents the potential value of the project. Bryah Resources Limited During the year, AVL invested $500,000 and concluded a mineral rights sale agreement with Bryah Resources Limited (“Bryah”) which successfully listed on ASX in October 2017. Under the mineral rights sale agreement, Bryah acquired the rights to all minerals except Vanadium/Uranium/Cobalt/Chromium/Titanium/Lithium/Tantalum/Manganese & and commenced exploration for gold-copper in December 2017. Iron Ore AVL presently hold 7.5 million shares and 1.25 million listed options (expiry 31 October 2020, exercise price $0.30) in Bryah which represents a 13.31% holding in that company. PLACEMENTS During the year, AVL completed the following placements to raise a total of $5,505,000 before costs: • 50,000,000 million new shares were issued at a price of $0.015/share with 1:1 (50 million) free attaching listed option (expiry 31/12/2018; exercise price $0.02) on 25 July 2017, raising $750,000 before costs; • 50,000,000 million new shares were issued at a price of $0.015/share with 1:1 (50 million) free attaching listed option (expiry 31/12/2018; exercise price $0.02) on 7 August 2017, raising $750,000 before costs; • 67,000,000 million new shares were issued at a price of $0.015/share with 1:1 (67 million) free attaching listed option (expiry 31/12/2018; exercise price $0.02) on 15 September 2017, raising $1,005,000 before costs, and • 75,000,000 million new shares were issued at a price of $0.04/share on 12 April 2018, raising $3,000,000 before costs. 9 Australian Vanadium Limited 2018 Annual Report DIRECTORS The names of the Directors of the Company in office during or since the end of the financial year and up to the date of this report are as follows. Directors were in office for this entire period unless otherwise stated. Name Vincent Algar Leslie Ingraham Brenton Lewis Daniel Harris Position Managing Director Executive Director Non-Executive Chairman Non-Executive Director The qualifications, experience and special responsibilities of each Director are as follows: VINCENT ALGAR BSC (Hons) Geology MAusIMM Mr Vincent Algar is a geologist by profession with over 25 years’ experience in the mining industry spanning underground and open cut mining operations, greenfields exploration, project development and mining services in Western Australia and Southern Africa. He has significant experience in the management of publicly listed companies, which includes the entire compliance, marketing and management process and encompasses the development of internal geological and administrative systems, exploration planning and execution, plus project acquisition and deal completion. Mr Algar was Managing Director of Shaw River Manganese Limited from 2006 to 2012 and was instrumental in the $20 million acquisition of a 75.5% stake in the Otjozondu Manganese Project in Namibia in 2011. Mr Algar has worked on a wide range of commodities, most recently in base metals and uranium. During the past three years, Mr Algar was also a director of the following ASX listed companies: Nil. LESLIE INGRAHAM Mr Ingraham has been in private business for over 25 years and is an experienced mineral prospector and professional investor. He has successfully worked as a consultant for both private companies and companies listed on the ASX. Core competencies include capital raising and shareholder liaison. During the past three years, Mr Ingraham was also a director of the following ASX listed companies: Bryah Resources Limited – appointed 15 November 2017. BRENTON LEWIS BBSc (Hons), MBSc Mr Lewis is an academic who has spent the past 20 years in the tertiary education sector. He has held management positions including Head of Department and Head of Post-Graduate Studies. He has published, taught and researched in areas including ethics and psychopathology. He has been a consultant to various health agencies including the Hong Kong Hospital Authority and the WA Health Department. He has served on numerous boards of management including academic and non- government organisations. During the past three years, Mr Lewis was also a director of the following ASX listed companies: Nil. DANIEL HARRIS Mr Harris brings with him a vast amount of expertise in the vanadium industry and an understanding of the resource sector from both a technical and financial perspective. Recent roles include the interim CEO and Managing Director at Atlas Iron Limited; CEO & Chief Operating Officer at Atlantic Ltd; Vice President & Head of Vanadium Assets at Evraz Group; Managing Director at Vametco Alloys; General Manager of Vanadium Operations at Strategic Minerals Corporation and as an independent technical and executive consultant to GSA Environmental Limited in the United Kingdom. 10 Australian Vanadium Limited 2018 Annual Report During the past three years, Mr Harris was a director of the following ASX listed companies: Atlas Iron Limited - appointed 6 May 2016. Paladin Energy Limited – appointed 1 February 2018 COMPANY SECRETARY NEVILLE BASSETT Mr Bassett is a Chartered Accountant with over 35 years of experience. He has been involved with a diverse range of Australian public listed companies in directorial, company secretarial and financial roles. Interests in the shares and options of the company and related bodies corporate As at the date of this report, the interests of the Directors and executives in the shares and options of Australian Vanadium Limited were: Vincent Algar1 Leslie Ingraham2 Brenton Lewis3 Daniel Harris4 Number of Number of Options Ordinary Shares over Ordinary Shares 692,307 10,571,129 30,478,774 12,028,600 - - - - 1 Mr Algar also holds 21,000,000 performance rights. Refer to the Remuneration Report for further details. 2 Mr Ingraham also holds 21,000,000 performance rights. Refer to the Remuneration Report for further details. 3 Mr Lewis also holds 12,000,000 performance rights. Refer to the Remuneration Report for further details. 4 Mr Harris also holds 6,000,000 performance rights. Refer to the Remuneration Report for further details. MEETINGS OF DIRECTORS The number of meetings of Directors (including meetings of committees of Directors) held during the year and the number of meetings attended by each Director were as follows: Board of Directors Number eligible to attend Number attended Vincent Algar Leslie Ingraham Brenton Lewis Daniel Harris 5 5 5 5 5 5 5 5 INSURANCE OF OFFICERS The Company has in place an insurance policy insuring Directors and Officers of the Company against any liability arising from a claim brought by a third party against the Company or its Directors and Officers, and against liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of their conduct whilst acting in their capacity as a Director or Officer of the Company, other than conduct involving a wilful breach of duty in relation to the Company. In accordance with a confidentiality clause under the insurance policy, the amount of the premium paid to the insurers has not been disclosed. This is permitted under Section 300(9) of the Corporations Act 2001. 11 Australian Vanadium Limited 2018 Annual Report ENVIRONMENTAL REGULATIONS The Group’s operations are subject to various environmental laws and regulations under government legislation. The exploration tenements held by the Group are subject to these regulations and there have not been any known breaches of any environmental regulations during the year under review and up until the date of this report. CORPORATE INFORMATION Nature of Operations and Principal Activities The principal continuing activities during the year of entities within the consolidated entity were exploration for vanadium/titanium and other economic resources, the development of vanadium electrolyte production and the sale of VRFB systems. Corporate Structure Australian Vanadium Limited is a limited liability company that is incorporated and domiciled in Australia. The Company has prepared a consolidated financial report incorporating the entities that it controlled during the financial year as follows: Australian Vanadium Limited - VSUN Energy Pty Ltd - (formerly Australian Vanadium Resources Pty Ltd) South African Lithium Pty Ltd - Australian Uranium Pty Ltd - Cabe Resources Limited - OPERATING AND FINANCIAL REVIEW Operating Review parent entity 100% owned controlled entity 100% owned controlled entity 100% owned controlled entity 100% owned controlled entity A review of operations for the financial year is contained within this Directors’ Report. The consolidated loss after income tax for the financial year was $2,486,071 (2017: $2,077,633). Financial Position At 30 June 2018, the Group had cash reserves of $5,152,782 (2017: $1,524,171). The net assets of the Group have increased by $5,121,171. The increase is largely due to the following factors: • • • • • • the conversion of 81,196,803 options into new shares, raising $1,256,439; the completion of 4 placements, involving the issue of 242,000,000 new shares, to raise $5,505,000; ongoing exploration and evaluation of the Gabanintha Vanadium and Blesberg Projects; advancement of the vanadium in energy storage strategy; incurring overheads and running costs consistent with operating a listed company; and remuneration of key management personnel essential to the continued success of the Group. Dividends No dividends were paid during the year and no recommendation is made as to dividends. 12 Australian Vanadium Limited 2018 Annual Report SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS Significant changes in the state of affairs of the Company during the financial year are detailed in the Company’s review of operations. In the opinion of the Directors, there were no other significant changes in the state of affairs of the Company that occurred during the financial year under review not otherwise disclosed in this Annual Report. EVENTS SUBSEQUENT TO REPORTING DATE No matters or circumstances have arisen since the end of the financial year which significantly affected, or may significantly affect, the operations of the Company, the results of those operations, or the state of affairs of the Company in subsequent financial years, other than as outlined in the Company’s review of operations which is contained in this Annual Report. LIKELY DEVELOPMENTS AND EXPECTED RESULTS The Company will continue to pursue its principal activity of exploration and evaluation, and associated activities as outlined in the Company’s review of operations. The Company will also continue to pursue other potential investment opportunities to enhance shareholder value. REMUNERATION REPORT (AUDITED) This report details the nature and amount of remuneration for each director and executive of Australian Vanadium Limited. The information provided in the remuneration report includes remuneration disclosures that are audited as required by section 308(3C) of the Corporations Act 2001. For the purposes of this report Key Management Personnel of the Group are defined as those persons having authority and responsibility for planning, directing and controlling the major activities of the Group, directly or indirectly, including any director (whether executive or otherwise) of the parent company. For the purposes of this report the term “executive” includes those key management personnel who are not Directors of the parent company. Remuneration Committee The full Board carries out the role and responsibilities of the Remuneration Committee and is responsible for determining and reviewing the compensation arrangements for the Directors themselves, the Managing Director and any Executives. Executive remuneration is reviewed annually having regard to individual and business performance, relevant comparative remuneration and internal and independent external advice. Remuneration Policy The board policy is to remunerate Directors at market rates for time, commitment and responsibilities. The board determines payments to the Directors and reviews their remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of Directors’ fees that can be paid is subject to approval by shareholders in a general meeting, from time to time. Fees for non-executive directors are not linked to the performance of the consolidated entity. However, to align Directors’ interests with shareholders’ interests, the Directors are encouraged to hold shares in the Company. The Company’s aim is to remunerate at a level that will attract and retain high-calibre directors and employees. Company Directors and officers are remunerated to a level consistent with the size of the Company. 13 Australian Vanadium Limited 2018 Annual Report The executive Directors and full-time executives receive a superannuation guarantee contribution required by the government, which is currently 9.5%, and do not receive any other retirement benefits. Some individuals, however, may choose to sacrifice part of their salary to increase payments towards superannuation. All remuneration paid to Directors and executives is valued at the cost to the Company and expensed. The Board believes that it has implemented suitable practices and procedures that are appropriate for an organisation of its size and maturity. During the year the Company included a performance-based component of remuneration for the Directors. Remuneration Structure In accordance with best practice corporate governance, the structure of non-executive director and executive compensation is separate and distinct. Non-executive Director Compensation Objective The Board seeks to set aggregate compensation at a level that provides the company with the ability to attract and retain directors of the highest calibre, whilst incurring a cost that is acceptable to shareholders. Structure The Constitution and the ASX Listing Rules specify that the aggregate compensation of non-executive directors shall be determined from time to time by a general meeting. An amount not exceeding the amount determined is then divided between the Directors as agreed. The latest determination approved by shareholders was an aggregate compensation of $500,000 per year. The amount of aggregate compensation sought to be approved by shareholders and the manner in which it is apportioned amongst Directors is reviewed annually. The Board considers advice from external consultants as well as the fees paid to non-executive directors of comparable companies when undertaking the annual review process. Non-Executive Directors’ remuneration may include an incentive portion consisting of options, as considered appropriate by the Board, which may be subject to Shareholder approval in accordance with ASX Listing Rules. Separate from their duties as Directors, the Non-Executive Directors may undertake work for the Company directly related to the evaluation and implementation of various business opportunities, including mineral exploration/evaluation and new business ventures, for which they receive a daily rate. These payments are made pursuant to individual agreement with the non-executive Directors and are not taken into account when determining their aggregate remuneration levels. Executive Compensation Objective The entity aims to reward executives with a level and mix of compensation commensurate with their position and responsibilities within the entity so as to: • reward executives for company and individual performance against targets set by appropriate benchmarks; • align the interests of executives with those of shareholders; • link rewards with the strategic goals and performance of the company; and • ensure total compensation is competitive by market standards. Structure In determining the level and make-up of executive remuneration, the Board negotiates a remuneration to reflect the market salary for a position and individual of comparable responsibility and experience. Due to the limited size of the Company and of its operations and financial affairs, the use of a separate 14 Australian Vanadium Limited 2018 Annual Report remuneration committee is not considered appropriate. Remuneration is regularly compared with the external market by participation in industry salary surveys and during recruitment activities generally. If required, the Board may engage an external consultant to provide independent advice in the form of a written report detailing market levels of remuneration for comparable executive roles. Remuneration consists of a fixed remuneration and a long-term incentive portion as considered appropriate. Compensation may consist of the following key elements: • Fixed Compensation; • Variable Compensation; • Short Term Incentive (STI); and • Long Term Incentive (LTI). Fixed Remuneration The level of fixed remuneration is set so as to provide a base level of remuneration which is both appropriate to the position and is competitive in the market. Fixed remuneration is reviewed annually by the Board having regard to the Company and individual performance, relevant comparable remuneration in the mining exploration sector and external advice. The fixed remuneration is a base salary or monthly consulting fee. Variable Pay - Long Term Incentives The objective of long-term incentives is to reward Directors/executives in a manner which aligns this element of remuneration with the creation of shareholder wealth. The incentive portion is payable based upon attainment of objectives related to the director’s/executive’s job responsibilities. The objectives vary, but all are targeted to relate directly to the Company’s business and financial performance and thus to shareholder value. Long term incentives (LTIs) granted to Directors and executives are delivered in the form of options or performance rights. LTI grants to executives are delivered in the form of employee share options or performance rights. Options are issued at an exercise price determined by the Board at the time of issue. The employee share options generally vest over a selected period. The objective of the granting of options or rights is to reward executives in a manner which aligns the element of remuneration with the creation of shareholder wealth. As such LTI’s are made to executives who are able to influence the generation of shareholder wealth and thus have an impact on the Company’s performance. The level of LTI granted is, in turn, dependent on the Company’s recent share price performance, the seniority of the executive, and the responsibilities the executive assumes in the Company. Typically, the grant of LTIs occurs at the commencement of employment or in the event that the individual receives a promotion and, as such, is not subsequently affected by the individual’s performance over time. Employment contracts of directors and senior executives The employment arrangements of the non-executive chairman and executive directors are not formalised in a contract of employment. Remuneration and other terms of employment for the Chief Executive Officer/Managing Director are formalised in an employment contract. Major provisions are set out below. Vincent Algar, Managing Director: • Annual base salary of $250,000 plus superannuation • Notice period required to be given by the Company or employee for termination of one month, except in the case of gross misconduct • Payment of termination benefit on termination by either party equal to the amount in lieu of the notice period 15 Australian Vanadium Limited 2018 Annual Report • 21,000,000 performance rights (granted on 12 July 2017) that will each convert into one ordinary share upon the satisfaction of the following milestones: (a) In respect to one-third of the Performance Rights, upon certification by an independent competent person, on or before 19 December 2019, of a JORC Reported resource or reserve on the Blesberg Lithium-Tantalum Project of 2,000,000 tonnes at a grade of at least 0.8% Li2O or Lithium equivalent in Beryl, Feldspar of Tantalum (reported in accordance with clause 50 of the JORC Code); and (b) In respect to one-third of the Performance Rights, upon certification by an independent competent person, on or before 19 December 2020, of a JORC Reported resource or reserve on the Blesberg Lithium-Tantalum Project of 4,000,000 tonnes at a grade of at least 0.8% Li2O or Lithium equivalent in Beryl, Feldspar of Tantalum (reported in accordance with clause 50 of the JORC Code); and (c) In respect to one-third of the Performance Rights, upon certification by an independent competent person, on or before 19 December 2021, of a JORC Reported resource or reserve on the Blesberg Lithium-Tantalum Project of 6,000,000 tonnes at a grade of at least 0.8% Li2O or Lithium equivalent in Beryl, Feldspar of Tantalum (reported in accordance with clause 50 of the JORC Code). • 5,000,000 performance rights (expiry 2 February 2020, subsequently converted on 13 February 2018) that convert into one ordinary share upon the satisfaction of the following milestones: (a) upon the Company releasing a Mineral Resource Statement containing a 2012 JORC Code Compliant Resource that includes Resources in the Measured Category; and (b) the Company’s shares trading at a volume weighted average market price of greater than 3.0 cents per share calculated over 20 consecutive trading days on which the Company’s shares have actually traded. The performance rights contain standard terms and conditions relevant to lapse of entitlement or right to conversion on cessation of employment. Compensation options granted to Key Management Personnel No options were granted to Directors or executives during the year ended 30 June 2018. Shares issued to Key Management Personnel on exercise of compensation options No shares were issued to Directors or executives on exercise of compensation options during the year. Compensation options lapsed during the year No options previously issued to Key Management Personnel lapsed during the year. 16 Australian Vanadium Limited 2018 Annual Report Details of remuneration for year Details of the remuneration of Directors and specified executives of Australian Vanadium Limited are set out in the following table. There are no other employees who are required to have their remuneration disclosed in accordance with the Corporations Act 2001. Short Term Benefits Post Share Based Employment Payments Salary & Fees Super- annuation Options & Rights Total Directors Vincent Algar1 Leslie Ingraham2 Brenton Lewis3 Daniel Harris4 (appointed 1 February 2017) Total Directors Year 2018 2017 2018 2017 2018 2017 2018 2017 2018 2017 Executives Todd Richardson (Project Manager) 2018 2017 (appointed 16 April 2018) Iain Ross (Exploration Manager) (appointed 15 April 2018) Total Executives 2018 2017 2018 2017 $ 239,583 225,000 180,330 183,960 59,500 52,000 58,485 12,424 537,898 473,384 30,000 - 18,750 - 48,750 - $ 22,760 21,375 15,675 - 5,652 4,940 - - 44,088 26,315 - - 1,781 - 1,781 - $ 205,000 95,000 205,000 95,000 82,000 38,000 - - 492,000 228,000 $ 467,344 341,375 401,005 278,960 147,152 94,940 58,485 12,424 1,073,986 727,699 - - - - - - 30,000 - 20,531 - 20,531 - Key Management Personnel 2018 2017 586,648 473,384 45,869 26,315 492,000 228,000 1,124,517 727,699 Performance Based Remuneration % 44% 28% 51% 34% 56% 40% 0% 0% 46% 31% 0% - 0% - 0% - 44% 31% 1 Mr Algar was granted 10,000,000 performance rights on 29 May 2015, which may convert into ordinary shares upon the satisfaction of operating milestones. On 19 August 2016, Mr Algar converted 5,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. On 13 February 2018, Mr Algar converted the remaining 5,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. Mr Algar was granted a further 21,000,000 performance rights on 12 July 2017, which may convert into ordinary shares upon the satisfaction of operating milestones. Refer to his employment contract details in this Remuneration Report for further information. 2 Mr Ingraham was granted 10,000,000 performance rights on 20 November 2015, which may convert into ordinary shares upon the satisfaction of operating milestones. On 19 August 2016, Mr Ingraham converted 5,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. On 13 February 2018, Mr Ingraham converted the remaining 5,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. Mr Ingraham was granted a further 21,000,000 performance rights on 12 July 2017, which may convert into ordinary shares upon the satisfaction of operating milestones. 3 Mr Lewis was granted 4,000,000 performance rights on 20 November 2015, which may convert into ordinary shares upon the satisfaction of operating milestones. On 19 August 2016, Mr Lewis converted 2,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. On 13 February 2018, Mr Lewis converted the remaining 2,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. Mr Lewis was granted a further 4,000,000 performance rights on 12 July 2017, which may convert into ordinary shares upon the satisfaction of operating milestones. 4 Mr Harris was granted 6,000,000 performance rights on 12 July 2017, which may convert into ordinary shares upon the satisfaction of operating milestones. 17 Australian Vanadium Limited 2018 Annual Report No other performance-related payments were made during the year. Performance hurdles are not attached to remuneration options if issued, however the Board determines appropriate vesting periods to provide rewards over a period of time to Key Management Personnel. Share holdings of Key Management Personnel Balance Received as Options Acquired/ 1 July Exercised (Disposed) 2017 Remun- eration Net Change/ Other Balance 30 June 2018 5,571,129 25,478,774 8,778,600 - - - - - - - - - - - 1,250,000 - 5,000,000 10,571,129 5,000,000 30,478,774 2,000,000 12,028,600 - - Directors Vincent Algar1 Leslie Ingraham2 Brenton Lewis3 Daniel Harris 1 Mr Algar holds 21,000,000 performance rights (2017: 5,000,000) which may convert into ordinary shares upon the satisfaction of operating milestones. On 13 February 2018, Mr Algar converted 5,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. Refer to his employment contract details in this Remuneration Report for further information. 2 Mr Ingraham holds 21,000,000 performance rights (2017: 5,000,000) which may convert into ordinary shares upon the satisfaction of operating milestones. On 13 February 2018, Mr Ingraham converted 5,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. 3 Mr Lewis holds 12,000,000 performance rights (2017: 2,000,000) which may convert into ordinary shares upon the satisfaction of operating milestones. On 13 February 2018, Mr Lewis converted 2,000,000 performance rights into ordinary shares following the satisfaction of operating milestones. 4 Mr Harris holds 6,000,000 performance rights which may convert into ordinary shares upon the satisfaction of operating milestones. Option holdings of Key Management Personnel and Balance Granted as Options Remun- 1 July Options Exercised Expired / Net Change/ Balance Number vested 30 June 2017 eration Cancelled Other 2018 exercisable Directors Vincent Algar Leslie Ingraham Brenton Lewis Daniel Harris 692,307 10,000,000 2,694,650 - - - - - - - - - - - - - - (10,000,000) (2,694,650) - 692,307 692,307 - - - - - - All equity transactions with Key Management Personnel have been entered into under terms and conditions no more favourable than those the Group would have adopted if dealing at arm’s length. Loans and other transactions with Key Management Personnel There were no loans to or from, or other transactions with, key management personnel. SHARE OPTIONS At the date of this report options were outstanding for the following unissued ordinary shares: • 375,258,771 listed options expiring 31 December 2018 at an exercise price of 2.0 cents each No person entitled to exercise these options had or has any right, by virtue of the option, to participate in any share issue of any other body corporate. 18 Australian Vanadium Limited 2018 Annual Report AUDITOR Armada Audit & Assurance Pty Ltd continues in office in accordance with Section 327 of the Corporations Act 2001. NON-AUDIT SERVICES No non-audit services were provided by our auditors, Armada Audit & Assurance Pty Ltd during the year. AUDITOR’S DECLARATION OF INDEPENDENCE The auditor’s independence declaration for the year ended 30 June 2018, as required under section 307C of the Corporations Act 2001, has been received and is included within the financial report. Signed in accordance with a resolution of Directors. Brenton Lewis Chairman 28 September 2018 19 Australian Vanadium Limited 2018 Annual Report Consolidated Statement of Profit or Loss and Other Comprehensive Income For the year ended 30 June 2018 Revenue Exploration and evaluation expenditure Depreciation Share Based Payments Directors’ fees and benefits expenses Other expenses Loss before income tax expense Income tax expense Net loss for year Other comprehensive income Consolidated 2018 $ 2017 $ Note 2(a) 219,325 183,018 - (42,191) (44,426) (40,337) (630,680) (57,000) (1,073,986) (727,699) 2(b) (956,304) (1,393,424) (2,486,071) (2,077,633) 3 - - (2,486,071) (2,077,633) Other comprehensive income for the year, net of tax - - Total comprehensive loss attributable to members of Australian Vanadium Limited (2,486,071) (2,077,633) Basic / diluted earnings per share 5 Cents (0.17) Cents (0.18) The accompanying notes form part of these financial statements. 20 Australian Vanadium Limited 2018 Annual Report Statement of Financial Position As at 30 June 2018 ASSETS Current Assets Cash and cash equivalent Trade and other receivables Total Current Assets Non-Current Assets Plant and equipment Exploration and evaluation expenditure Investments Total Non-Current Assets TOTAL ASSETS LIABILITIES Current Liabilities Trade and other payables Provisions Total Current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Reserves Accumulated Losses TOTAL EQUITY The accompanying notes form part of these financial statements. Consolidated 2018 $ 2017 $ Note 6 7 8 9 10 11 12 5,152,782 1,524,171 192,901 80,612 5,345,683 1,604,783 278,288 304,271 16,291,330 15,422,575 2,346,671 1,809,171 18,916,289 17,536,017 24,261,972 19,140,800 140,271 187,138 31,273 31,182 171,544 218,320 171,544 218,320 24,090,428 18,922,480 13 76,177,333 67,960,815 (562,500) - (51,524,405) (49,038,335) 24,090,428 18,922,480 21 Australian Vanadium Limited 2018 Annual Report Statement of Changes in Equity For the year ended 30 June 2018 Consolidated Issued Capital $ Accumulated Losses $ Other Reserves $ Balance as at 1 July 2016 64,621,753 (46,960,702) Loss for the year Total comprehensive loss for the year - - (2,077,633) (2,077,633) Shares issued as consideration Shares issued on conversion of options Securities issued on conversion of Performance Rights Capital raising costs 1,388,000 1,697,259 285,000 (31,197) - - - - Balance as at 30 June 2017 67,960,815 (49,038,335) Loss for the year Total comprehensive loss for the year - - (2,486,071) (2,486,071) Securities issued pursuant to Placements 5,505,000 Shares issued as consideration 500,000 Shares issued on conversion of options 1,256,439 Securities issued on conversion of Performance Rights Impairment of asset valuation Capital raising costs 1,382,680 - (427,601) - - - - - - Total $ 17,661,051 (2,077,633) (2,077,633) 1,388,000 1,697,259 285,000 (31,197) 18,922,480 (2,486,071) (2,486,071) 5,505,000 500,000 1,256,439 1,382,680 - - - - - - - - - - - - - - (562,500) (562,500) - (427,601) Balance as at 30 June 2018 76,177,333 (51,524,405) (562,500) 24,090,428 The accompanying notes form part of these financial statements. 22 Australian Vanadium Limited 2018 Annual Report Statement of Cash Flows For the year ended 30 June 2018 Cash flows from operating activities Payments to suppliers and employees Interest received Net receipts from other entities Expenditure on mining interests Consolidated 2018 $ 2017 $ Note (1,669,080) (1,984,454) 44,526 58,487 159,795 264 - (42,843) Net cash provided by / (used) in operating activities 6(a) (1,464,759) (1,968,546) Cash flows from investing activities Expenditure on mining interests Payment for Investments Payment for property plant & equipment Net cash used in investing activities Cash flows from financing activities Proceeds from issue of shares Payment of capital raising costs Net cash provided by financing activities (724,769) (764,270) (500,000) (361,171) (18,443) (226,297) (1,243,212) (1,351,738) 6,761,439 1,697,259 (424,857) (49,463) 6,336,582 1,647,796 Net increase in cash held 3,628,611 (1,672,488) Cash at beginning of the financial year Cash at end of financial year 1,524,171 3,196,659 5,152,782 1,524,171 The accompanying notes form part of these financial statements. 23 Australian Vanadium Limited 2018 Annual Report Notes to the Financial Statements 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES These consolidated financial statements and notes represent those of Australian Vanadium Limited (the “Company”) and Controlled Entities (the “Consolidated Entity” or “Group”) for the year ended 30 June 2018. Australian Vanadium Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange. The Company is domiciled in Western Australia. The nature of operations and principal activities of the Group are described in the Directors' Report. 1(a) Basis of Preparation The financial statements are general purpose financial statements that have been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The Group is a for-profit entity for financial reporting purposes under Australian Accounting Standards. The financial statements have been prepared on an accruals basis and are based on historical costs modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities. Material accounting policies adopted in preparation of these financial statements are presented below and have been consistently applied unless otherwise stated. The Group’s financial statements are presented in Australian dollars. 1(b) Adoption of new and revised standards In the current year, the Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) that are relevant to its operations and effective for the current annual reporting period. The adoption of these new and revised Standards and Interpretations has not resulted in a significant or material change to the Group’s accounting policies. The Group has also reviewed all new Standards and Interpretations that have been issued but are not yet effective for the year ended 30 June 2018. As a result of this review the Directors have determined that there is no impact, material or otherwise, of the new and revised Standards and Interpretations on its business and, therefore, no change necessary to Group accounting policies. 1(c) Statement of Compliance The financial report was authorised for issue on 28 September 2018. Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about transactions, events and conditions. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards (IFRS). 1(d) Basis of consolidation The consolidated financial statements comprise the financial statements of Australian Vanadium Limited (“Company” or “Parent Entity”) and its subsidiaries as at 30 June each year (“Consolidated” or “Group”). Subsidiaries are all entities over which the Group has control. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group and cease to be consolidated from the date on which control is transferred out of the Group. Investments in subsidiaries are accounted for at cost in the individual financial statements of Australian Vanadium Limited. The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. 24 Australian Vanadium Limited 2018 Annual Report In preparing the consolidated financial statements, all intercompany balances and transactions, income and expenses and profit and losses resulting from intra-group transactions have been eliminated in full. 1(e) Revenue and other income Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. The following specific recognition criteria must also be met before the revenue is recognised. Interest revenue is recognised as it accrues, taking into account the effective yield on the financial asset. 1(f) Cash and cash equivalents Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as described above, net of outstanding bank overdrafts. 1(g) Trade and other receivables Trade receivables, which generally have 30-90 day terms, are recognised and carried at original invoice amount less an allowance for any uncollectible amounts. An allowance for doubtful debts is made when there is objective evidence that the Group will not be able to collect the debts. Bad debts are written off when identified. 1(h) Income Tax Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the reporting date. Deferred income tax is provided on all temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax liabilities are recognised for all taxable temporary differences except: • when the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or • when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except: • when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or • when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, in which case a deferred tax asset is only recognised to the extent that it is probable that the temporary difference will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilised. The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised. 25 Australian Vanadium Limited 2018 Annual Report Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date. Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss. Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority. The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income legislation and the anticipation that the Group will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law. 1(i) Other taxes Revenues, expenses and assets are recognised net of the amount of GST except: • when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and • receivables and payables, which are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the statement of financial position. Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority. 1(j) Financial assets Financial assets within the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as either financial assets at fair value through profit or loss, loans and receivables, held-to- maturity investments, or available-for-sale investments, as appropriate. When financial assets are recognised initially, they are measured at fair value, plus, in the case of investments not at fair value through profit or loss are directly attributable as transactions costs. The Group determines the classification of its financial assets after initial recognition and, when allowed and appropriate, re- evaluates this designation at each financial year-end. All regular purchases and sales of financial assets are recognised on the trade date i.e. the date that the Group commits to purchase the asset. Regular purchases or sales are purchases or sales of financial assets under contracts that require delivery of the assets within the period established generally by regulation or convention in the marketplace. (i) Financial assets at fair value through profit or loss Financial assets classified as held for trading are included in the category ‘financial assets at fair value through profit or loss’. Financial assets are classified as held for trading if they are acquired for the purpose of selling in the near term. Derivatives are also classified as held for trading unless they are designated as effective hedging instruments. Gains or losses on investments held for trading are recognised in the statement of profit or loss and other comprehensive income. 26 Australian Vanadium Limited 2018 Annual Report (ii) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are carried at amortised cost using the effective interest method. Gains and losses are recognised in the statement of profit or loss and other comprehensive income when the loans and receivables are derecognised or impaired, as well as through the amortisation process. (iii) Available-for-sale investments Available-for-sale investments are those non-derivative financial assets that are designated as available- for-sale or are not classified as any of the three preceding categories. After initial recognition, available- for sale investments are measured at fair value with gains or losses being recognised as a separate component of equity until the investment is derecognised or until the investment is determined to be impaired, at which time the cumulative gain or loss previously reported in equity is recognised in profit or loss. The fair value of investments that are actively traded in organised financial markets is determined by reference to quoted market bid prices at the close of business on the reporting date. For investments with no active market, fair value is determined using valuation techniques. Such techniques include using recent arm’s length market transactions; reference to the current market value of another instrument that is substantially the same; discounted cash flow analysis and option pricing models. 1(k) Exploration and evaluation expenditure Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an exploration and evaluation asset in the year in which they are incurred where the following conditions are satisfied: (i) the rights to tenure of the area of interest are current; and (ii) at least one of the following conditions is also met: (a) (b) the exploration and evaluation expenditures are expected to be recouped through successful development and exploitation of the area of interest, or alternatively, by its sale; or exploration and evaluation activities in the area have not, at the reporting date, reached a stage which permits a reasonable assessment of the existence, or otherwise, of economically recoverable reserves and active and significant operations in, or relation to, the area of interest are continuing. Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies, exploratory drilling, trenching and sampling and associated activities and an allocation of depreciation and amortisation of assets used in exploration and evaluation activities. General and administrative costs are only included in the measurement of exploration and evaluation costs where they are related directly to operational activities in a particular area of interest. Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable amount of the exploration and evaluation asset (for the cash generating unit(s) to which it has been allocated being no larger than the relevant area of interest) is estimated to determine the extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in previous years. Where a decision has been made to proceed with development in respect of a particular area of interest, the relevant exploration and evaluation asset is tested for impairment and the balance is then reclassified to development. 27 Australian Vanadium Limited 2018 Annual Report 1(l) Impairment of assets The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets and the asset’s value in use cannot be estimated to be close to its fair value. In such cases the asset is tested for impairment as part of the cash-generating unit to which it belongs. When the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Impairment losses relating to continuing operations are recognised in those expense categories consistent with the function of the impaired asset unless the asset is carried at a revalued amount (in which case the impairment loss is treated as a revaluation decrease). An assessment is also made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss unless the asset is carried at a revalued amount, in which case the reversal is treated as a revaluation increase. After such a reversal, the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life. 1(m) Trade and other payables Trade payables and other payables are carried at amortised costs and represent liabilities for goods and services provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make future payments in respect of the purchase of these goods and services. 1(n) Share-based payment transactions The Group may provide benefits to employees (including senior executives) of the Group in the form of share-based payments, whereby employees render services in exchange for shares or rights over shares (equity-settled transactions). When provided, the cost of these equity-settled transactions with employees is measured by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by an external valuer using a Black-Scholes model. In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price of the shares of Australian Vanadium Limited (market conditions) if applicable. The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (the vesting period). The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the extent to which the vesting period has expired, and (ii) the Group’s best estimate of the number of equity instruments that will ultimately vest. 28 Australian Vanadium Limited 2018 Annual Report No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair value at grant date. The amount charged or credited to the statement of profit or loss and other comprehensive income for a period represents the movement in cumulative expense recognised as at the beginning and end of that period. No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only conditional upon a market condition. If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been modified. In addition, an expense is recognised for any modification that increases the total fair value of the share-based payment arrangement, or is otherwise beneficial to the employee, as measured at the date of modification. If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award and designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the original award, as described in the previous paragraph. The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share. 1(o) Issued capital Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. 1(p) Segment Reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors of the Company. The Group operates in two segments, being mineral exploration within Australia and the sale of VRB systems. 1(q) Earnings per share Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted to exclude any costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus element. Diluted earnings per share is calculated as net profit attributable to members of the parent, adjusted for: • • • costs of servicing equity (other than dividends) and preference share dividends; the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as expenses; and other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential ordinary shares; divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element. 1(r) Investments in associates An associate is an entity over which the consolidated entity has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee, but is not control or joint control over those policies. 29 Australian Vanadium Limited 2018 Annual Report Investments in associates are accounted for in the parent entity using the cost method and in the consolidated entity using the equity method of accounting. Under the equity method, the investment in an associate is initially recorded at cost. The carrying amount of the investment is adjusted to recognise changes in the consolidated entity's share of net assets of the associate since the acquisition date. The consolidated entity’s share of post-acquisition profits or losses is recognised in the statement of profit or loss and its share of post-acquisition movements in other comprehensive income is presented as part of the consolidated entity's other comprehensive income. Unrealised gains or transactions between the Group and its associates are eliminated to the extent of the Group’s interests in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group. 1(s) Plant and equipment Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows: Plant and equipment Motor vehicles - - 5 to 10 years 8 years The assets’ residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each financial year end. (i) Impairment The carrying values of property, plant and equipment are reviewed for impairment at each reporting date, with recoverable amount being estimated when events or changes in circumstances indicate that the carrying value may be impaired. The recoverable amount of plant and equipment is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the cash-generating unit to which the asset belongs, unless the asset’s value in use can be estimated to be close to its fair value. An impairment exists when the carrying value of an asset or cash-generating units exceeds its estimated recoverable amount. The asset or cash-generating unit is then written down to its recoverable amount. Impairment losses are recognised in the statement of profit or loss and other comprehensive income. (ii) Derecognition and disposal An item of plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of profit or loss and other comprehensive income in the year the asset is derecognised. 1(t) Significant Accounting Estimates and Judgments Significant accounting judgments In the process of applying the Group’s accounting policies, management has made the following judgments, apart from those involving estimations, which have the most significant effect on the amounts recognised in the financial statements. 30 Australian Vanadium Limited 2018 Annual Report Exploration and evaluation assets The Group’s accounting policy for exploration and evaluation expenditure is set out at Note 1(l). The application of this policy necessarily requires management to make certain estimates and assumptions as to future events and circumstances. Any such estimates and assumptions may change as new information becomes available. If, after having capitalised expenditure under the policy, it is concluded that the expenditures are unlikely to be recovered by future exploitation or sale, then the relevant capitalised amount will be written off to the statement profit or loss and other comprehensive income. Significant accounting estimates and assumptions The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period are: (i) Impairment of assets In determining the recoverable amounts of assets, in the absence of quoted market prices, estimations are made regarding the present value of future cash flows using asset-specific discount rates and the recoverable amount of the asset is determined. Value-in-use calculations performed in assessing recoverable amounts incorporate a number of key estimates. (ii) Share-based payment transactions The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined from market value. 31 Australian Vanadium Limited 2018 Annual Report 2. REVENUE AND EXPENSES 2(a) Revenue Interest received Gain/(loss) on Asset Sale Lease Income R & D concession 2(b) Other Expenses Salaries and wages Superannuation Stock Exchange and registry fees Rent and office facility expenses Legal fees Auditor’s fees Travel and accommodation Other corporate and administration expenses 3. INCOME TAX 3(a) Income tax expense Consolidated 2018 $ 2017 $ 59,065 55,206 - 127,122 1,601 158,659 219,325 690 - 183,018 292,316 283,036 24,725 113,156 83,586 2,208 15,000 122,008 303,305 19,617 78,379 103,137 33,964 15,500 138,292 778,499 956,304 1,450,424 Major components of income tax expense for the Years ended 30 June 2018 and 30 June 2017 are: Income statement Current income Current income tax charge (benefit) Current income tax not recognised Research and Development Concession Deferred income tax 639,143 (639,143) - - - - Relating to origination and reversal of temporary differences 523,260 567,062 Deferred tax benefit not recognised (523,260) (567,062) Income tax expense (benefit) reported in income statement - - 32 Australian Vanadium Limited 2018 Annual Report Consolidated 2018 $ 2017 $ A reconciliation of income tax expense (benefit) applicable to accounting profit before income tax at the statutory income tax rate to income tax expense at the company’s effective income tax rate for the Years ended 30 June 2018 and 30 June 2017 is as follows: Accounting profit (loss) before tax from continuing operations (2,486,071) (2,077,633) Accounting profit (loss) before income tax At the statutory income tax rate of 27.5% (2017: 30%) (2,486,071) (2,077,633) (683,669) (623,289) Add: Non-deductible expenses Temporary differences and losses not recognised Less: R&D Tax Offset At effective income tax rate of 0% (2017: 0%) Income tax expense reported in income statement Total income tax expense 3(b) Deferred tax assets Liabilities: Receivables Capitalised exploration expenditure Assets: Trade and other payables Provisions Business related costs Tax Losses Deferred tax assets/(liabilities) have not been recognised in respect of the following items: 311,420 415,880 56,228 567,061 (43,631) - - - (4,949) (166,206) (171,155) 2,750 9,382 253,827 - - - - - - - - - - 2,853,507 2,415,670 3,119,466 2,415,670 2,948,311 2,415,670 The tax losses do not expire under current legislation. Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available against which the Company can utilise the benefits. 4. AUDITORS’ REMUNERATION Amounts paid or due and payable to Armada Audit & Assurance Pty Ltd for: - audit or review services 15,000 15,000 15,500 15,500 33 Australian Vanadium Limited 2018 Annual Report 5. EARNINGS PER SHARE Basic earnings per share The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share is as follows: Net loss for the year Consolidated 2018 $ 2017 $ Cents (0.17) Cents (0.18) (2,486,071) (2,077,633) No. No. Weighted average number of ordinary shares used in the calculation of basic EPS 1,444,996,859 1,140,007,472 6. CASH AND CASH EQUIVALENTS Cash at bank Short term deposits 96,425 156,120 5,056,357 1,368,051 5,152,782 1,524,171 Cash at bank earns interest at floating rates based on daily deposit rates. Cash and cash equivalents for the purpose of the statement of cash flows are comprised of cash at bank and short term deposits. 6(a) Reconciliation of loss for the year to net cash flows from operating activities: Loss for the year Non-cash flows in profit/loss Depreciation Impairment of exploration and evaluation Gain/Loss on Sale of Asset Share based payments Changes in operating assets and liabilities (Increase)/decrease in trade and other receivables Increase/(decrease) in trade and other payables Increase/(decrease) in provisions Net cash flows from operating activities (2,486,071) (2,077,633) 44,426 - - 40,337 10,514 (127,122) 1,122,680 285,000 (87,289) (58,596) 91 (10,328) (98,344) 19,544 (1,464,759) (1,968,546) 6(b) Non-cash financing and investing activities In the year the following non-cash financing and investing activities occurred: (i) nil 34 Australian Vanadium Limited 2018 Annual Report 7. TRADE AND OTHER RECEIVABLES Current GST receivable Other receivables Trade Debtors Consolidated 2018 $ 2017 $ 50,411 53,833 88,657 36,921 43,691 - 192,901 80,612 Other receivables are non-interest bearing and generally repayable within 12 months. Due to the short term nature of these receivables, their carrying value is assumed to approximate their fair value. 8. PLANT & EQUIPMENT PIant and Equipment At cost Accumulated depreciation Motor Vehicles At cost Accumulated depreciation Total At cost Accumulated depreciation 357,300 (89,968) 267,332 338,857 (48,495) 290,362 27,000 27,000 (16,044) (13,091) 10,956 13,909 384,300 (106,012) 278,288 365,857 (61,586) 304,271 8(a) Movements in carrying amounts Movements in the carrying amounts for each class of plant and equipment during the financial year: Balance at 1 July 2016 Additions Depreciation expense Balance at 30 June 2017 Additions Depreciation expense Balance at 30 June 2018 Plant & Motor Equipment Vehicles Total 6,814 4,935 11,749 320,858 12,000 332,858 (37,310) (3,026) (40,336) 290,362 13,909 304,271 18,443 - 18,443 (41,473) (2,953) (44,426) 267,332 10,956 278,288 35 Australian Vanadium Limited 2018 Annual Report 9. DEFERRED EXPLORATION EXPENDITURE Expenditure brought forward Less expenditure recouped on sale of asset Add expenditure incurred on purchase of asset Expenditure incurred during the year Expenditure carried forward Consolidated 2018 $ 2017 $ 15,422,575 14,498,230 (600,000) (32,878) 760,000 708,755 - 957,223 16,291,330 15,422,575 The expenditure above relates principally to the exploration and evaluation phase. The ultimate recoupment of this expenditure is dependent upon the successful development and commercial exploration, or alternatively, sale of the respective areas of interest, at amounts at least equal to the carrying value. 10. INVESTMENTS IN ASSOCIATES Investments in associates at cost Allowance for impairment Investment in associate at fair value Interest is held in the following associated companies: 5,459,171 4,359,171 (3,112,500) (2,550,000) 2,346,671 1,809,171 Name Principal Activities Country of Incorporation Shares Ownership Interest 2018 % 2017 % Carrying amount of investment 2018 $ 2017 $ Unlisted: Apogei Pty Ltd South African Lithium Pty Ltd Southern African Lithium and Tantalum Pty Ltd Listed: Mineral Exploration Mineral Exploration Mineral Exploration Australia Ordinary 20 20 - - South Africa Ordinary 100 100 1,288,000 1,288,000 South Africa Ordinary 5 5 361,171 361,171 Bryah Resources Limited Mineral Exploration Australia Ordinary 13.31 7.14 697,500 160,000 10(a) Equity accounted losses of associate are as follows: Share of associates' loss before income tax Share of associates' income tax Share of associates' loss after income tax - - - - - - 36 Australian Vanadium Limited 2018 Annual Report 11. TRADE AND OTHER PAYABLES Current Trade payables and accruals Consolidated 2018 $ 2017 $ 140,271 140,271 187,139 187,139 Trade creditors are non-interest bearing and are normally settled on 30 day terms. Due to the short term nature of trade payables and accruals, their carrying value is assumed to approximate their fair value. 12. PROVISIONS Current Employee entitlements 13. ISSUED CAPITAL AND RESERVES 13(a) Issued and paid up capital Ordinary shares - fully paid Ordinary shares - partly paid Share issue costs written off against issued capital 31,273 31,273 31,182 31,182 77,323,050 68,678,931 8,000 8,000 (1,153,717) (726,116) 76,177,333 67,960,815 2018 Number 2018 $ 2017 Number 2017 $ 13(b) Movement in ordinary shares on issue (i) Ordinary shares - fully paid Balance at beginning of year Issue of ordinary shares on conversion of options Issue of ordinary shares via Placements Issue of ordinary shares in lieu of cash consideration Issue of ordinary shares on conversion of performance rights 1,215,734,216 68,678,931 1,002,118,601 65,308,672 81,196,803 1,256,439 115,365,615 1,697,259 242,000,000 5,505,000 - - 15,000,000 55,192,000 500,000 1,382,680 83,250,000 15,000,000 1,388,000 285,000 Balance at end of year 1,609,123,019 77,323,050 1,215,734,216 68,678,931 37 Australian Vanadium Limited 2018 Annual Report Consolidated 2018 $ 2017 $ (ii) Ordinary shares - partly paid ($0.0389 unpaid) Balance at beginning of year 80,000,000 8,000 80,000,000 8,000 Issue of partly paid ordinary shares Call on partly paid shares cancelled - - - - - - - - Balance at end of year 80,000,000 8,000 80,000,000 8,000 Total issued shares 1,689,123,019 77,331,050 1,295,734,216 68,686,931 13(c) Terms and conditions of issued capital Ordinary shares have the right to receive dividends as declared and, in the event of winding up the Company, to participate in proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Fully paid ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company. Options and partly paid ordinary shares do not entitle their holder to any voting rights. 13(d) Share Options At 30 June 2018, the following options over unissued ordinary shares were outstanding: • 391,184,181 listed options expiring 31 December 2018 at an exercise price of 2.0 cents each 13(e) Performance Rights At 30 June 2018, the following performance rights were outstanding: • • • • • 40,000,000 Class B performance rights expiring 19 December 2019. 20,000,000 performance rights expiring 19 December 2019. 20,000,000 performance rights expiring 19 December 2020. 20,000,000 performance rights expiring 19 December 2021. 769,538 performance rights expiring 30 June 2019. 13(f) Share-Based Payment Reserve The share-based payments reserve is used to recognise the fair value of options issued. 13(g) Asset Revaluation Reserve The asset revaluation reserve is used to recognise adjustments in the carrying amount of investments. 38 Australian Vanadium Limited 2018 Annual Report Consolidated 2018 $ 2017 $ 14. COMMITMENTS 14 (a) Exploration Commitments The Group has certain obligations to perform minimum exploration work and to expend minimum amounts of money on such work on mining tenements. These obligations may be varied from time to time subject to approval and are expected to be fulfilled in the normal course of the operations of the Group. These commitments have not been provided for in the accounts. The minimum expenditure commitment on the tenements is: Payable - no later than 1 year - between 1 year and 5 years 14(b) Operating Lease Commitments 254,460 295,400 549,860 254,380 415,400 669,780 Minimum lease payments payable for non-cancellable operating leases contracted for but not recognised in the financial statements: Payable - no later than 1 year - between 1 year and 5 years 93,410 57,685 151,095 117,238 151,217 268,455 The non-cancellable leases are for office premises and a storage unit. The office premises rental commenced on 1 March 2017 and ends on 28 February 2020, with rent payable monthly in advance. The storage unit rental commenced on 1 October 2016 and ends on 30 September 2018, with rent payable monthly in advance. 15. CONTINGENT LIABILITIES It is possible that native title, as defined in the Native Title Act 1993, might exist over land in which the Group has an interest. It is impossible at this stage to quantify the impact (if any) that the existence of native title may have on the operations of the Group. However, at the date of this report, the Directors are aware that applications for native title claims have been accepted by the Native Title Tribunal over Group tenements. 16. SEGMENT INFORMATION AASB 8 requires a ‘management approach’ under which segment information is presented on the same basis as that used for internal reporting purposes. The Board as a whole will regularly review the identified segments in order to allocate resources to the segment and to assess its performance. The Group has identified two operating segments for 2018 being: 1. 2. Exploration – consisting of the Gabanintha Vanadium Project and other exploration projects, and Energy storage – VSUN Energy Pty Limited’s vanadium redox flow battery marketing and sales activities. 39 Australian Vanadium Limited 2018 Annual Report Consolidated 2018 $ 2017 $ Segment revenues, assets and liabilities are those that are directly attributable to a segment and the relevant portion that can be allocated to the segment on a reasonable basis. Segment assets include all assets used by a segment and primarily consist of plant and equipment and project tenements. Segment Liabilities consist primarily of trade and other creditors and employee benefits. The following tables present revenue, expenditure and asset information regarding operating segments for the year ended 30 June 2018. Sales to External Customers Other Revenue Total Segment Revenue Total Segment Results Total Segment Assets Total Segment Liabilities Impairment of Assets Depreciation and Amortisation Interest Income Exploration $ Energy Storage Unallocated Consolidated $ $ $ - 1,601 158,659 158,659 - 1,601 - 59,065 59,065 1,601 217,724 219,325 (216,728) (190,956) (2,078,387) (2,486,071) 16,291,330 163,290 7,692,353 24,146,973 67,357 - - - 196 - 103,991 171,544 (562,500) (562,500) (17,553) (26,873) (44,426) - 59,065 59,065 17. RELATED PARTY TRANSACTIONS 17(a) Subsidiaries The consolidated financial statements include the financial statements of Australian Vanadium Limited and the subsidiaries listed in the following table. Australian Uranium Pty Ltd Cabe Resources Ltd VSUN Energy Pty Ltd 1 South African Lithium Pty Ltd Country of Incorporation Australia Australia Australia South Africa Equity Holding 2018 % 100 100 100 100 2017 % 100 100 100 100 Principal Activities Mineral exploration Mineral exploration Energy storage Mineral exploration 1 Formerly Australian Vanadium Resources Pty Ltd. 17(b) Director-related entities The Group engaged the following entities during the financial year for the following services on normal commercial terms: Nil 40 Australian Vanadium Limited 2018 Annual Report 18. PARENT ENTITY DISCLOSURES 18(a) Summary financial information Assets Current assets Non-current assets Total assets Liabilities Current liabilities Total liabilities Equity Issued capital Reserves Accumulated losses Total equity Financial performance Loss for the year Other comprehensive income Total comprehensive loss 18(b) Guarantees Parent 2018 $ 2017 $ 5,289,132 19,186,217 24,475,349 1,567,018 16,775,789 18,342,807 123,635 123,635 183,055 183,055 76,177,289 (562,500) (51,269,274) 67,960,815 - (46,960,701) 24,351,714 21,000,114 (2,401,874) - (1,900,500) - (2,401,874) (1,900,500) Australian Vanadium Limited has not entered into any guarantees. 18(c) Other Commitments and Contingencies Australian Vanadium Limited (parent entity) has exploration commitments and operating lease commitments as described in Note 14(a). It has no contingent liabilities other than those discussed in note 15. 19. KEY MANAGEMENT PERSONNEL DISCLOSURES 19(a) Compensation of Key Management Personnel Refer to the remuneration report contained in the Directors’ Report for details of the remuneration paid or payable to each member of the Group’s key management personnel. Director and Executive Disclosures Compensation of key management personnel Short-term personnel benefits Post-employment benefits Share Based Payments Consolidated 2018 $ 2017 $ 586,648 45,869 492,000 1,124,517 473,384 26,315 228,000 727,699 19(b) Loans and Other Transactions with Key Management Personnel There were no loans to key management personnel or their related entities during the financial year. Other transactions with key management personnel are described in Note 17(b). 41 Australian Vanadium Limited 2018 Annual Report 20. SHARE-BASED PAYMENTS 20(a) Share-based payments expensed A total of $1,032,680 was expensed as share-based payments for the period ended 30 June 2018 (30 June 2017: $285,000). 20(b) Summary of options granted as share-based payments No options were issued as share-based payments during the year ended 30 June 2018 or 30 June 2017. 20(c) Performance Rights 60,000,000 Performance Rights were granted to Directors during the year ended 30 June 2018 (30 June 2017: nil). Refer to the Remuneration Report for the terms and conditions of previously issued rights. 21. FINANCIAL RISK MANAGEMENT The consolidated entity’s principal financial instruments comprise receivables, payables, cash and short-term deposits. The consolidated entity manages its exposure to key financial risks in accordance with the consolidated entity’s financial risk management policy. The objective of the policy is to support the delivery of the consolidated entity’s financial targets while protecting future financial security. The main risks arising from the consolidated entity’s financial instruments are interest rate risk, credit risk and liquidity risk. The consolidated entity does not speculate in the trading of derivative instruments. The consolidated entity uses different methods to measure and manage different types of risks to which it is exposed. These include monitoring levels of exposure to interest rates and assessments of market forecasts for interest rates. Ageing analysis of and monitoring of receivables are undertaken to manage credit risk, liquidity risk is monitored through the development of future rolling cash flow forecasts. The Board reviews and agrees policies for managing each of these risks as summarised below. Primary responsibility for identification and control of financial risks rests with the Board. The Board reviews and agrees policies for managing each of the risks identified below, including for interest rate risk, credit allowances and cash flow forecast projections. Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset and financial liability are disclosed in note 1 to the financial statements. 21(a) Interest rate risk The consolidated entity’s exposure to risks of changes in market interest rates relates primarily to the consolidated entity’s cash balances. The consolidated entity constantly analyses its interest rate exposure. Within this analysis consideration is given to potential renewals of existing positions, alternative financing positions and the mix of fixed and variable interest rates. As the consolidated entity has no interest-bearing borrowings its exposure to interest rate movements is limited to the amount of interest income it can potentially earn on surplus cash deposits. The following sensitivity analysis is based on the interest rate risk exposures in existence at the reporting date. At the reporting date, the consolidated entity had the following financial assets exposed to variable interest rates that are not designated in cash flow hedges: Financial Assets Cash and cash equivalents (interest-bearing accounts) 5,152,782 1,524,171 5,152,782 1,524,171 42 Australian Vanadium Limited 2018 Annual Report Consolidated 2018 $ 2017 $ The following sensitivity analysis is based on the interest rate risk exposures in existence at the reporting date. At the reporting date, if interest rates had moved as illustrated in the table below, with all other variables held constant, post-tax profit and equity relating to financial assets of the consolidated entity would have been affected as follows: Estimates of reasonably possible movements: Post tax profit - higher / (lower) +0.5% -0.5% Equity - higher / (lower) +0.5% -0.5% 21(b) Liquidity Risk 13,133 (13,133) 13,133 (13,133) 21,959 (21,959) 21,959 (21,959) The consolidated entity has no significant exposure to liquidity risk as there is effectively no debt. The consolidated entity manages liquidity risk by monitoring immediate and forecast cash requirements and ensuring adequate cash reserves are maintained. 21(c) Credit risk Credit risk arises from the financial assets of the consolidated entity, which comprise deposits with banks and trade and other receivables. The consolidated entity’s exposure to credit risk arises from potential default of the counter party, with the maximum exposure equal to the carrying amount of these instruments. The carrying amounts of financial assets included in the statement of financial position represents the consolidated entity’s maximum exposure to credit risk in relation to those assets. The consolidated entity does not hold any credit derivatives to offset its credit exposure. The consolidated entity trades only with recognised, creditworthy third parties and as such collateral is not requested nor is it the consolidated entity’s policy to securitise its trade and other receivables. Receivable balances are monitored on an ongoing basis with the result that the consolidated entity does not have a significant exposure to bad debts. There are no significant concentrations of credit risk within the consolidated entity. 21(d) Capital Management Risk Management controls the capital of the consolidated entity in order to maximise the return to shareholders and ensure that the Group can fund its operations and continue as a going concern. Management effectively manages the Group’s capital by assessing the consolidated entity’s financial risks and adjusting its capital structure in response to changes in these risks and in the market. These responses include the management of expenditure and debt levels and share and option issues. The consolidated entity has no external loan debt facilities other than trade payables. There have been no changes in the strategy adopted by management to control capital of the consolidated entity since the prior year. 21(e) Commodity Price and Foreign Currency Risk The consolidated entity’s exposure to price and currency risk is minimal given the consolidated entity is still in the exploration phase. 43 Australian Vanadium Limited 2018 Annual Report 21(f) Fair Value The methods of estimating fair value are outlined in the relevant notes to the financial statements. All financial assets and liabilities recognised in the statement of financial position, whether they are carried at cost or fair value, are recognised at amounts that represent a reasonable approximation of fair values unless otherwise stated in the applicable notes. 22. EVENTS SUBSEQUENT TO THE REPORTING DATE No matters or circumstances have arisen since the end of the financial year which significantly affected, or may significantly affect, the operations of the Company, the results of those operations, or the state of affairs of the Company in subsequent financial years, other than as outlined in the Company’s review of operations which is contained in this Annual Report. 44 Australian Vanadium Limited 2018 Annual Report Directors’ Declaration The Directors of the Company declare that: 1. the financial statements and notes set out on pages 24 to 44 are in accordance with the Corporations Act 2001 including: a. b. complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements, and giving a true and fair view of the consolidated entity’s financial position as at 30 June 2018 and of the performance for the year ended on that date, and; 2. in the Directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. The Directors have been given the declarations by the Managing Director and chief financial officer pursuant to Section 295A of the Corporations Act 2001. This declaration is made in accordance with a resolution of the Board of Directors. Brenton Lewis Chairman 28 September 2018 45 Australian Vanadium Limited 2018 Annual Report 46 Australian Vanadium Limited 2018 Annual Report 47 Australian Vanadium Limited 2018 Annual Report 48 Australian Vanadium Limited 2018 Annual Report 49 Australian Vanadium Limited 2018 Annual Report Annual Mineral Resource Statement 1. GABANINTHA PROJECT - MINERAL RESOURCE STATEMENT A summary of the Mineral Resources at the Gabanintha Project as at 30 June 2018 is shown in Table 1 below. The updated Mineral Resource estimation was carried out Trepanier Pty Ltd, resulting in the estimation of Measured, Indicated, and Inferred Mineral Resources. All mineralised domains, are reported above 0.4% V2O5 for the low-grade ore zones and above 0.7% V2O5 within the high-grade zones. The Mineral Resource estimate consists of: • • • • 175.5 million tonnes at 0.77% V2O5 containing 1.35 million tonnes of V2O5; discrete high-grade zones of 93.6 million tonnes at 1.00% V2O5 containing 936,000 tonnes of V2O5; discrete low-grade zones of 77.5 million tonnes at 0.50% V2O5 containing 384,000 tonnes of V2O5, and combined Measured and Indicated Mineral Resources of 34.1 Million tonnes at 0.77% V2O5 in low and high-grade zones containing 263,000t V2O5. TABLE 1 GABANINTHA PROJECT MINERAL RESOURCES STATEMENT AS AT 30 JUNE 2018 JORC Resource Class Tonnes Million V2O5 % Fe % High Grade Zone Measured Indicated Inferred Subtotal Low Grade Zone Indicated Inferred Subtotal Transported Zone Inferred Subtotal TOTAL Measured Indicated Inferred TOTAL 50 10.1 4.9 78.6 93.6 19.1 58.5 77.5 4.3 4.3 10.1 24.0 141.4 175.5 1.11 1.09 0.98 1.00 0.51 0.49 0.50 0.65 0.65 1.11 0.63 0.77 0.77 42.7 43.3 42.4 42.5 23.9 25.5 25.1 28.1 28.1 42.7 27.9 35.0 34.5 TiO2 % 12.6 12.1 11.2 11.4 7.0 6.7 6.8 7.2 7.2 12.6 8.0 9.2 9.3 SiO2 % 10.3 10.5 11.4 11.3 27.8 27.5 27.5 24.7 24.7 10.3 24.2 18.5 18.8 Al2O3 % LOI % 8.0 7.8 7.6 7.6 18.1 16.5 16.9 16.7 16.7 8.0 16.0 11.5 11.9 4.0 3.7 3.4 3.5 8.7 7.4 7.7 8.5 8.5 4.0 7.7 5.2 5.5 Australian Vanadium Limited 2018 Annual Report 2. MATERIAL CHANGES AND RESOURCE STATEMENT COMPARISON A comparison between the 2017 and 2018 Mineral Resource Estimates for the Gabanintha Project is shown in Table 2 below. TABLE 2 GABANINTHA PROJECT COMPARISON BETWEEN 2017 & 2018 MINERAL RESOURCE ESTIMATES Al2O3 JORC Resource Class % ESTIMATE AS AT 30 JUNE 2018 Tonnes Million V2O5 % SiO2 % TiO2 % Fe % Measured Indicated Inferred TOTAL 10.1 1.11 42.7 12.6 10.3 8.0 24.0 0.63 141.4 0.77 27.9 35.0 175.5 0.77 34.5 8.0 9.2 9.3 24.2 16.0 18.5 11.5 18.8 11.9 ESTIMATE AS AT 30 JUNE 2017 Measured Indicated Inferred TOTAL 10.2 1.06 41.6 12.0 11.6 8.6 25.4 0.62 144.1 0.75 27.7 34.4 179.6 0.75 33.8 7.9 9.0 9.0 24.9 15.8 19.2 11.7 19.6 12.1 LOI % 4.0 7.7 5.2 5.5 4.2 7.5 5.2 5.4 There is no material change in the Mineral Resource Estimate between 2017 and 2018. The updated estimation represented a 2% decrease in the overall Resource, a 1% increase in the Measured Resource, a 5% decrease in the Indicated Resource and a 1.8% decrease in the Inferred Resource categories for the Project compared to the 2017 estimation. The revised estimate was conducted following a review of the geological interpretation of the weathering profile and subsequent variation to density allocations for the Gabanintha mafic layered intrusion. Extensive consideration of geophysics and a review of the geological continuity along-strike and down-dip was also conducted. The Group is not aware of any new information or data that materially affects the information as previously released and all material assumptions and technical parameters underpinning the estimates continue to apply and have not materially changed. 3. GOVERNANCE ARRANGEMENTS AND INTERNAL CONTROLS The Group has appropriate systems in place and suitably qualified and competent geological consultants to complete any resource estimation or review to the required standards as shown in the 2012 JORC Code Guidelines. The Quality Assurance, Sampling Systems, Assay Procedures, Data Recording, Interpretation Standards and Resource Estimation Methods and other parameters as set out in Table 1 of the JORC Code 2012 Guidelines are closely followed. The mineral resources reported have been generated by independent external consultants where appropriate who are experienced in best practices in modelling and estimation methods. The consultants have also undertaken reviews of the quality and suitability of the underlying information used to determine the resource estimate. In addition, management carries out regular reviews and audits of internal processes and external contractors that have been engaged by the group. 51 Australian Vanadium Limited 2018 Annual Report The Company policy is that all steps are recorded during the resource drilling program and then the estimation stage. All results from field logs and assays to database entries and modelling data are validated, reviewed and checked by independent and qualified geological personnel. Competent Person Statement – Mineral Resource Estimation The information in this report relating to the Gabanintha Project Mineral Resource estimate reported is based on and fairly represents information compiled by Mr Lauritz Barnes, (Consultant with Trepanier Pty Ltd) and Mr Brian Davis (Consultant with Geologica Pty Ltd). Mr Davis is a shareholder of Australian Vanadium Limited. Mr Barnes and Mr Davis are members of the Australasian Institute of Mining and Metallurgy and have sufficient experience of relevance to the styles of mineralisation and types of deposits under consideration, and to the activities undertaken to qualify as Competent Persons as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Specifically, Mr Barnes is the Competent Person for the estimation and Mr Davis is the Competent Person for the database, geological model and site visits. Mr Barnes and Mr Davis consent to the inclusion in this report of the matters based on their information in the form and context in which they appear. Competent Person Statement – Exploration Results and Exploration Targets The information in this report that relates to Exploration Results and Exploration Targets is based on and fairly represents information and supporting documentation prepared by Mr Brian Davis (Consultant with Geologica Pty Ltd). Mr Davis is a shareholder of Australian Vanadium Limited. Mr Davis is a member of the Australasian Institute of Mining and Metallurgy and has sufficient experience of relevance to the styles of mineralisation and types of deposits under consideration, and to the activities undertaken to qualify as Competent Persons as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Specifically, Mr Davis consents to the inclusion in this report of the matters based on his information in the form and context in which they appear. 52 Australian Vanadium Limited 2018 Annual Report 4. SCHEDULE OF INTERESTS IN MINING TENEMENTS AS AT 28 SEPTEMBER 2018 PROJECT TENEMENT AREA EQUITY Gabanintha Gabanintha Gabanintha Gabanintha Gabanintha Gabanintha Gabanintha Gabanintha Gabanintha Gabanintha Gabanintha Gabanintha Coates Nowthanna Hill Blesberg TOTAL E51/843 E51/1396 E51/1534 E51/1576 E51/1685 E51/1694 E51/1695 P51/2566 P51/2567 P51/2634 MLA 51/878 E51/1899 E70/4924 M51/771 (NC) 940 PR 18 blocks 1 block 8 blocks 10 blocks 15 blocks 14 blocks 2 blocks 147.66 ha 111.66 ha 171.85 ha 3,563.0 ha 16 blocks 1 block 301.0 ha 887 ha 100%1 100%1 100%1 100%1 100%1 100%1 100%1 100%1 100%1 100%1 100%1 100% 100% 100% Nil2 ANNUAL EXPENDITURE COMMITMENT $70,000 $20,000 $20,000 $30,000 $20,000 $20,000 $15,000 $5,920 $4,480 $3,960 Application Application $15,000 $30,100 - $254,460 Notes: 1. Mineral Rights for V/U/Co/Cr/Ti/Li/Ta/Mn & iron ore only. Bryah Resources Limited retains 100% rights all minerals except V/U/Co/Cr/Ti/Li/Ta/Mn & iron ore on the Gabanintha Project. AVL has the right to acquire up to 50.03% interest in the holding company that owns 100% interest in Prospecting Right (NC) 940 PR 2. 53 Australian Vanadium Limited 2018 Annual Report ASX Additional Information Additional information required by the ASX Listing Rules not disclosed elsewhere in this Annual Report is set out below. The information is current as at 27 September 2018. 1. DISTRIBUTION OF EQUITY SECURITIES Analysis of numbers of equity security holders by size of holding: Listed Shares, Fully Paid Ordinary Listed 2 cent Options expiring 31 December 2018 Range No of Holders Number of shares No of Holders 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001+ Total 145 170 358 3,674 2,074 6,421 30,088 522,275 3,260,451 168,170,482 1,450,011,674 1,621,994,970 Unlisted Shares, Partly Paid Ordinary 16 22 13 159 304 514 Number of options 6,790 58,256 100,123 8,101,628 370,622,663 378,889,460 Range No of Holders Number of shares 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001+ Total - - - - 5 5 - - - - 80,000,000 80,000,000 Unmarketable Parcels There were 440 holders of less than a marketable parcel of ordinary shares. 2. UNQUOTED SECURITIES Holders of more than 20% of the abovementioned unquoted securities are: Holder Name Woolmaton Pty Ltd Lisen Zhang 3. RESTRICTED SECURITIES Unlisted Shares, Partly Paid Ordinary 28,000,000 28,000,000 Unlisted Options, expiring 31 Dec 17 Exercise Price 1.4712c 10,000,000 - There are no restricted securities or securities subject to voluntary escrow as at 31 August 2017. 4. SUBSTANTIAL SHAREHOLDERS There were no substantial holders as at 27 September 2018. 5. CORPORATE GOVERNANCE The Company’s Corporate Governance Statement is located on its website at: australianvanadium.com.au 54 Australian Vanadium Limited 2018 Annual Report 6. TOP 20 SHAREHOLDERS Name J P Morgan Nominees Australia Limited Citicorp Nominees Pty Ltd HSBC Custody Nominees (Australia) Limited Mr Cal Douglas Tostevin BNP Paribas Nominees Pty Ltd Mr Peter James Muir Mr Neale Parsons Pet FC Pty Ltd Pet FC Pty Ltd Jalein Pty Ltd Z International (Australia) Pty Ltd Sunarp Pty Ltd 1 2 3 4 5 6 7 8 9 10 11 12 13 Mr Robert Glyn Salathiel + Mrs Danielle Louise Salathiel 14 Mr John Martin Heuser + Ms Victoria Margaret Gillam 15 Mr Charles Michael Higgins 16 Mr Brenton James Lewis 17 Ms Ann Maree Endean 18 Mr Vincent James Algar 19 Mr Leslie James Ingraham 20 Toulon Pty Ltd Total Total Remaining Holders Balance 7. TOP 20 LISTED OPTIONHOLDERS Name 1 Mr Peter Andrew Proksa 2 Jekor Pty Ltd 3 Z International (Australia) Pty Ltd 4 Kojen Pty Ltd 5 Gillam Super Investments Pty Ltd 6 Mr Scott Alan Malone 7 Mr Andrew Charles Alexander Mackenzie 8 Mr Ashley William Robin Parker 9 Mr Tze Hao Teo 10 Mr William Wynn Jones 11 Mr Michael Yuxun Kuang 12 Mr Cajetan Francis Mascarenhas 13 Mr Peter James Muir 14 Mr Henryk Klocek 15 Mr Tze Hao Teo 16 17 Mr Raymond Andrew Hegarty + Mrs Zoe Elizabeth Hegarty 18 19 Mr David Fagan 20 Penguinesque Projects Pty Ltd Oreo Holdings Pty Ltd P A Shakespeare Investing Pty Ltd Total Total Remaining Holders Balance Number of Shares 57,103,555 36,110,778 34,008,213 28,000,000 24,564,445 22,134,147 22,000,000 21,000,000 20,666,642 20,000,000 16,666,667 15,450,258 13,966,424 12,000,000 11,346,735 10,778,600 10,200,000 10,000,000 10,000,000 9,900,000 405,896,464 1,216,098,506 Number of Listed Options 22,000,000 21,256,600 16,666,667 14,996,001 10,100,000 10,100,000 9,400,000 7,950,000 5,880,000 5,873,053 5,817,317 5,575,000 5,318,704 5,000,000 4,096,635 4,071,515 4,000,000 4,000,000 3,911,454 3,892,276 169,905,222 208,984,238 % of Shares 3.52 2.23 2.10 1.73 1.51 1.36 1.36 1.29 1.27 1.23 1.03 0.95 0.86 0.74 0.70 0.66 0.63 0.62 0.62 0.61 25.02 74.98 % of Listed Options 5.81 5.61 4.40 3.96 2.67 2.67 2.48 2.10 1.55 1.55 1.54 1.47 1.40 1.32 1.08 1.07 1.06 1.06 1.03 1.03 44.84 55.16 55